Ionis Pharmaceuticals, Inc.

Good morning and welcome to IONIS Second Quarter 2026 Financial Results Conference Call. As a reminder, this call is being recorded. At this time, I would like to turn the call over to Wade Walke, Senior Vice President of Investor Relations, to lead off the call. Please go ahead.

Thank you, Andrea. Before we begin, I encourage everyone to go to the Investor section of the IONIS website To view the press release and related financial tables we will be discussing today, including a reconciliation of GAAP to non-GAAP financials. We believe non-GAAP financials results better represent the economics of our business and how we manage our business. We've also posted slides on our website that accompany today's call. With me this morning are Brett Monia, Chief Executive Officer, Kyle Genet, Chief Global Product Strategy Officer, Holly Kortasiewicz, Chief Development Officer, and Beth Hougen, Chief Financial Officer. Eugene Schneider, Chief Clinical Development Officer, and Eric Swayze, Executive Vice President of Research, will also join us for the Q&A portion of the call. I would like to draw your attention to slide three, which contains our forward-looking language statement. During this call, we will be making forward-looking statements that are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and our actual results may differ materially. I encourage you to consult the risk factors contained in our SEC filings for additional detail. With that, I'll turn the call over to Brett.

Thanks, Wade. Good morning, everyone, and thank you for joining us on today's call. Iona Center is the second half of 2026, well-positioned to achieve the strategic opportunities that lie ahead. We have the R&D engine, the pipeline, commercial capabilities, and financial discipline we need to execute on and achieve our goals. We are continuing to build momentum across our commercial medicines and, in parallel, We continue to strengthen and advance our wholly-owned pipeline to deliver our next wave of important medicines. Last month, we achieved a landmark milestone with the approval of Tringolza as the first and only FDA-approved medicine to reduce triglycerides and the risk of acute pancreatitis in adults with severe hypertriglyceridemia, or SHTG. Although still early days, we are highly encouraged. With our launch momentum to date, in fact, we began receiving prescriptions for Tringolza on the day of approval. We are also pleased that both the 50mg and 80mg doses were in the channel within one week. Based on a strong profile and the enthusiasm we are seeing in prescribing, we are confident that Tringolza is well-positioned to help a large population of patients in need and become the first Ionis-owned multi-billion-dollar medicine. Donzara for hereditary angioedema also continues to gain momentum. We expect Donzara to continue driving growth as it and more established in the HAE prophylactic treatment landscape. We also continue to advance our leadership in the development of breakthrough treatments for a wide range of neurological diseases. We remain on track for the anticipated launch of Zilgen-Nersen coming up soon, which is positioned to be the first disease-modifying treatment for Alexander disease and the first independent launch from our neurological disease pipeline. Falling closely behind Zilgen-Nersen is Zobudden-Nersen, our medicine for Angelman syndrome, which completed an enrollment in the phase three reveal study last month, keeping it on track for data next year. Earlier this month, we also announced the initiation of clinical development for ion 337 in Dravet syndrome, expanding our clinical stage neurology pipeline, which now includes eight medicines that are wholly owned. Complementing our wholly owned pipeline is our partnered pipeline, which includes medicines targeting both rare and highly prevalent diseases providing significant additional value for ionis. This includes Bepiravircin, our medicine for chronic hepatitis B. With the PDUFA target action date of October 26 and additional global filings under review, Bepiravircin is on track for a global launch this year, positioning it to be a first in-class medicine for the millions of people around the world living with this disease. Data from the Phase III pellicarsin LpA horizon study in patients with elevated LpA in cardiovascular disease is also a key catalyst coming up in the second half of this year. We were disappointed with the outcome of the CardioTransform Phase III study for eplontersin in ATTR cardiomyopathy that we reported earlier this month. Although eplontersin demonstrated substantial and durable reductions in TTR, nominally significant results in the monotherapy subgroup and favorable safety. It did not meet the primary efficacy endpoint in the overall population. We and AstraZeneca continue to analyze the data and will present the results at ESC in August. Our strong commercial execution, continued pipeline progress, and our strong second quarter financial performance underscore the many opportunities we have to continue building substantial value. We remain on track to deliver on our 2026 financial guidance and achieve our goal of cash flow break even in 2028. With that, I'll now turn the call over to Kyle, who will speak to the commercial execution of Tringolza and Donzera and launch preparations for Zilgen Ersin. Holly will then discuss how we are advancing our pipeline, highlighting several important catalysts ahead, and Beth will review our financial results and outlook. And with that, I'll turn it over to Kyle.

Thank you, Brett. Our commercial momentum continues to build, positioning us to deliver even greater impact in the second half of the year and beyond. We are executing well against our commercial priorities, including strong progress on the Tringolza and Donzera launches and preparation for the Zolginersen launch. Beginning with Tringolza, demand continues to build in FCS, driven by an increasing number of patients initiating and remaining on treatment. As expected, second quarter product sales reflected the reduced Tringolza wholesale acquisition cost that went into effect on April 1st. We updated the price ahead of the anticipated SHTG approval to align with annual payer contracting cycles to accelerate access to Tringolza. Underlying demand in FCS remained strong, with the second quarter delivering the highest number of patient starts since launch began. Together with our commercial execution and FCS and early market access efforts, we've established a strong foundation for the next phase of Trigulza growth as we launch in the broader patient population. The recent approval of Trigulza for SHTG marked the defining moment for Ionis. Importantly, it expanded our opportunity to serve millions of people living with severely elevated triglycerides. We were particularly pleased with the Trigulza label, which includes prevention of acute pancreatitis and the indication statement. The label is supported by the groundbreaking results from the phase three core and core two studies which further underscores the importance of preventing acute pancreatitis in people with SHTG. Building on this strong foundation, I'm happy to share that the SHTG launch is off to an encouraging start in the first few weeks. Thanks to the exceptional execution of our commercial team, We began receiving prescriptions on day one, and both the 50-milligram and 80-milligram doses were in the channel within approximately one week. Since the approval, our team has already engaged with many of our top physician targets who care for the majority of high-risk patients. In addition, our omni-channel launch campaign has produced strong engagement, which is further helping to rapidly build awareness of SHTG, APOC3 biology, and Trigulza. There are an estimated 3 million people in the U.S. with SHTG, including approximately 1 million people with high-risk SHTG who have triglycerides above 880 milligrams per deciliter or triglycerides above 500 in a history of acute pancreatitis or other comorbidities. The risk of acute pancreatitis begins to increase at triglyceride levels above 500 and rises exponentially in people with triglycerides above 880. As the first-to-market therapy with a novel mechanism proven to reduce the risk of painful, costly, and potentially fatal acute pancreatitis attacks, Tringolza is well-positioned to serve patients across both segments. The majority of high-risk SHTG patients are treated by approximately 20,000 cardiologists, endocrinologists, and lipidologists across the U.S., with additional patients treated by primary care physicians. Early in the launch, we were seeing prescriptions from all three specialties in addition to a meaningful contribution from primary care physicians. We've also seen physicians prescribe Tringolza to people with high-risk SHTG and those with TGs between 500 and 800 milligrams per deciliter with no history of acute pancreatitis. Physicians are prescribing both the 50 and 80 milligram doses, highlighting the importance of dosing flexibility. which enables treating physicians to tailor treatment to the individual needs of each patient. Importantly, we are executing on our market access strategy as planned. We have made good progress obtaining coverage for the broad population in patients with triglycerides above 500 milligrams per deciliter and across both commercial and government plants. Ultimately, we expect the SHTG market to comprise approximately 60% commercial and 40% government covered patients. We also expect payer coverage to continue expanding through the remainder of this year and into next year as payers complete the reviews. We are also making progress in expanding access to Tringolza outside the U.S. In the EU, Sovia is continuing to advance the launch in FCS, while also actively laying the groundwork for a strong launch in the broader SHTG indication anticipated next year. With this early SHTG launch momentum, Tringulza is on track to meet our full year 2026 revenue guidance and positioned to achieve our projections for more than $3 billion in peak annual revenue. The Donzera launch also continued to gain momentum. In less than one year on the market, Donzera has already captured a meaningful share of the US HE prophylaxis market, which is largely a switched market. This growth is driven by increasing adoption across all patient segments. including patients switching from existing prophylactic therapies, patients who were previously only using on-demand treatment, and treatment-naive patients. Physicians and patients consistently provide positive feedback on Donzera, highlighting Donzera's strong efficacy and favorable safety profile, its differentiated RNA targeting mechanism, the positive switch data, which HCPs describe as, quote, differentiating and motivating, end quote, and Donzera's patient-friendly profile that includes a self-administered auto-injector that can be stored at room temperature for up to six weeks. The base of repeat prescribers continues to grow. This is a key indicator that Donzera is providing substantial benefit for patients and HCPs are having a positive experience prescribing it. Given that most patients on HE prophylactic medicines are already established on existing therapies, continued penetration will take time. However, the launch fundamentals give us confidence that Donzera will contribute meaningfully to our commercial revenue growth in 2026 and beyond. Outside the U.S., our partner Otsuka is making good progress with Donzera in the launch in the EU. Over time, we expect ex-U.S. countries to become an important contributor to overall Donzera growth. Turning to Zilgenersen, we are well prepared for the launch for the treatment of Alexander disease coming up later this year. Based on the positive Phase III results for zilganersen, we received FDA priority review with BDUFA date of September 22nd. We have an expanded access program underway, and our commercial preparations are right on track, centered around four key priorities. First, pending approval, we will work to transition patients who are currently receiving zilganersen through the clinical study or the expanded access program to commercial therapy. Second, we will focus on getting patients already diagnosed with Alexander disease in the U.S. on zilganersen. It's estimated that about half of the approximately 300 patients in the U.S. are already identified through ICD-10 codes and patient registries. Third, we will drive disease awareness among physicians who care for people with rare neurological diseases, prioritizing engagement with the dozen U.S. leukodystrophy centers. Following approval, we expect these centers as key referral and treatment hubs to play a central role in identifying more patients and providing them with treatment. And fourth, we are building a dedicated patient services platform, which we have designed based on feedback from stakeholders to address the specific needs of the Alexander disease community. Additionally, our customer-facing team is now in place and prepared to rapidly reach patients upon our potential Zilga nursing approval. Importantly, we expect to leverage many of the capabilities we are building for Zilgenersen for our future neurology medicine launches. We also recently took an important step toward bringing Zilgenersen to people with Alexander disease outside the U.S. to our agreement with Recordati. Recordati plans to file for regulatory approval for Zilgenersen in the EU and Japan next year with additional global filings to follow. With our first broad patient population launch now underway, Growing momentum across our commercial portfolio and a strong pipeline behind it, we believe Ionis is well positioned to bring more important medicines to people with serious diseases. And with that, I'll turn the call over to Holly.

Thank you, Kyle. This quarter we made meaningful progress across our pipeline. Tringold's approval for the treatment of SHGG is a significant milestone for Ionis and for patients. Trangolza's approval was supported by the unprecedented results from the Phase III Core and Core II studies, in which Trangolza achieved rapid, substantial, and clinically meaningful placebo-adjusted mean reductions in triglycerides of up to 72%. These triglyceride reductions resulted in a profound reduction in acute pancreatitis events by up to 91%. Trangolza treatment also led to 86% of patients reaching triglyceride levels below 500 mg per deciliter, the threshold that defines SHGG. up to 54% of patients reaching normal triglyceride levels below 150 mg per deciliter in favorable safety and tolerability, which resulted were further reinforced by longer-term data from the Core and Core 2 open-label extension study, which we recently presented at the National Lipid Association Scientific Session. We will share additional data from the OLE at ESC in August. As Kyle mentioned, the Tringolza label includes acute pancreatitis risk reduction in the indication statement, which underscores the importance Thank you for joining us. We recently advanced ION 775 into a Phase IIb study in patients with SHTG or moderately elevated triglycerides based on positive Phase I data in healthy volunteers with elevated triglycerides. These results showed the potential for an optimized profile characterized by substantial, durable, and sustained reductions in ApoC3 and triglycerides with the potential for semiannual or less frequent dosing. We look forward to presenting these data on ION 775 at ESC next month. and as Brett mentioned, we will also share detailed data from the Appel and Thurston CardioTransform Study at ESC. Turning next to our neurology franchise, we remain on track to bring Zilga Nurse into patients with Alexander disease later this year, assuming approval. This rare, progressive and often fatal leukodystrophy profoundly affects patients and families. And today, there are no approved disease-modifying therapies. Our positive phase three results mark the first time any therapy demonstrated a disease-modifying impact in these patients. Our next wholly-owned Phase III program is Obitinersen for the treatment of Angelman syndrome. Angelman syndrome is a neurodevelopmental disorder that causes profound and lifelong physical and cognitive impairments, estimated to affect more than 100,000 people globally. We recently announced that enrollment in the Phase III reveal study is complete, which keeps us on track to report data in the second half of next year, bringing us an important step closer to potentially delivering this medicine to families in need.

We recently advanced our medicine for the treatment of Gervais syndrome,

A rare, severe, and lifelong neurological disorder into a Phase I-II first-in-human study. We advance ION337 based on encouraging preclinical data, which we believe positions this program to become a best-in-class treatment for this devastating disease. ION337 is our first wholly-owned medicine that uses our proprietary NMA chemistry, designed to achieve maximal and sustained modulation of SCN1A with a long dosing interval. Our NMA chemistry is the same breakthrough technology that enabled Selenersen to achieve substantial efficacy and favorable safety with annual dosing in a Phase I study in patients with spinal muscular atrophy. Our partner Biogen recently advanced Selenersen into Phase III development based on these positive results, positioning it to meet the remaining unmet needs of people living with spinal muscular atrophy. We were also encouraged by the Phase II CELIA data Biogen presented at AAIC for Dirinersen in early Alzheimer's disease. These results are the first to demonstrate the significant potential of targeting intercellular tau as a treatment for AD. Dear Nursen showed significant reductions in CSF tau levels, accompanied by a reversal of tau pathology as measured by tauPAT. We also saw remarkable effects on cognition, as shown by a 34% to 50% slowed decline in MMSE versus placebo, and a meaningful effect on composite endpoints that include both cognitive and functional domains. Although the Phase 2 study did not meet the primary endpoint, the totality of these data support Biogen's plan to initiate Phase 3 development. We are also pleased with the recent initiation of the Phase 3 intrepid study of sapoblursin by our partner, Ono. This study is evaluating sapoblursin in people with phlebotomy-dependent polysemia vera, a rare but potentially life-threatening hematologic disease with significant unmet needs. Assuming positive data, sapoblursin would represent an important value driver from our partnered pipeline. and Betha Pearson, our medicine for the treatment of chronic hepatitis B partnered with GSK, is on track for approval in the U.S. and Japan later this year, with multiple additional global approvals anticipated next year. Based on positive data from the Phase III B well studies demonstrating unprecedented fungal cure rates, Betha Pearson is positioned to become a first-in-class treatment for chronic hepatitis B, a disease affecting millions of people around the world. Also in the second half, we expect late-stage readouts from several partnered programs, including Pella Carson for LP little a, driven cardiovascular disease with Novartis, Ulis Nersen for FUS ALS with Atsuka, and Seth Aksharsen for IgA nephropathy with Roche. Overall, the progress we have made across the pipeline this year reinforces both the strength of our R&D engine and our confidence in the next wave of opportunities to reach more and more patients in need and drive future growth. And with that, I'll turn the call over to Beth.

Thank you, Holly. We delivered strong financial results in the first half of this year, supported by increased revenue from our commercial medicines and meaningful R&D revenue from our partnered programs, while we continued to invest in our long-term growth. Revenues in the second quarter and first half of this year were $268 million and $514 million, respectively, representing significant year-over-year growth of 56%, and 69% compared to the same period last year, excluding the $280 million one-time payment we received from Ono in the first half of last year for Sapa Blurson. Commercial revenue increased to $119 million in the second quarter and $226 million in the first half, up 15% and 27% respectively from the same period last year. These increases were driven primarily by Donzera product sales. Tringolza generated product sales at $5 million and $32 million in the second quarter and first half of this year. The decrease in revenues in the second quarter followed the April 1st reduction in the Tringolza WAC price, which we implemented strategically ahead of our expansion into the broader SHTG indication. We continue to expect Tringolza to return to revenue growth in the second half of this year as the SHTG launch gains momentum. John Thera generated $26 million in the second quarter and $42 million in the first half, with second quarter sales increasing by 63% compared to this year's first quarter. Research and development revenue was $149 million in the second quarter and $288 million year-to-date. reflecting continued progress across our partnered pipeline. Operating expenses increased as expected in the second quarter and first half of this year compared to the same periods last year, driven by costs associated with commercializing Tringolza and Donzera, preparations to launch Zilgenursen later this year, and advancing medicines in our rich pipeline. We ended the second quarter with $2.1 billion in cash, cash equivalents, and short-term investments, enabling us to continue investing in our commercial medicines and wholly owned pipeline. Looking to the remainder of the year, our strong first half results keep us on track to achieve our full year 2026 financial guidance. We continue to project full year revenue in the range of $875 to $900 million, with results weighted slightly more toward commercial revenues. We remain on track to achieve our Tringolza and Donzera product-level guidance. This includes full-year Tringolza product sales of $100 to $110 million, with Tringolza expected to return to revenue growth in the second half of this year as the SHTG launch gains momentum, and full-year Donzera product sales of $110 to $120 million with continued growth forecasted in the second half of this year. Additionally, we anticipate meaningful R&D revenue from existing collaborations, including the potential for additional milestones tied to Biff Puraversen, Pella Carson, and other partner programs as they advance. On the expense side, we continue to expect 2026 operating expenses to increase in the low teens percentage range compared to last year. driven primarily by sales and marketing expenses related to our ongoing and upcoming commercial launches. We project R&D expenses to remain consistent with last year as several of our late-stage studies conclude and we redeploy resources to earlier-stage programs within our wholly-owned pipeline. And as a result of our focus on improving our operating leverage, we expect a non-GAAP operating loss between 425 and $475 million. This is similar to our 2025 operating loss after adjusting for the one-time SAPA Blurston license fee we earned last year. And finally, we are projecting a 2026 year-end cash balance of greater than $1.6 billion. With our strong first half financial performance and our outlook for the remainder of this year, we remain on track to achieve our full year 2026 financial guidance and Cash Flow breakeven in 2028 while continuing to drive substantial growth and longer-term value creation. With that, I'll turn the call back over to Brett.

Thank you, Beth. Our outlook for the remainder of 2026 and beyond reflects Ionis' strength and the substantial opportunity for continued success that lies ahead. We are executing well on our independent launches for Tringolza and Donzera and are well prepared for our next launch, Zilgenersen in Alexander disease. anticipated later this year. In addition to driving value through commercial success, we also have many important near and midterm catalysts from across our development pipeline, each with the potential to further drive substantial value. We are well positioned to continue executing successfully on our commercial launches and to deliver a steady cadence of breakthrough medicines to patients. Now, before we move to Q&A, I'd like to take a moment to recognize Frank Bennett, our chief scientific officer whose planned retirement we announced earlier this morning. Frank is one of Ionis' founding scientists and has helped shape Ionis and advance the field of RNA targeted medicines. While his leadership helped create this new sector for human therapeutics, some of his greatest contributions were in the field of neurology, which led to the approvals of Spinraza for SMA and CalSati for Sat1-ALS, along with the establishment of a rich pipeline and other employees to deliver a steady stream of breakthrough treatments for neurological diseases. On behalf of the entire IONIS team, I want to thank Frank for his many contributions, his dedication to patients and the lasting impact he has had on IONIS and the field of oligonucleotide therapeutics. And with that, we'll open the call up for questions.

We will now begin the question and answer session. To ask a question, you may press star then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then 2. And our first question will come from Jason Gerberry of Bank of America. Please go ahead.

Hey, guys. Thanks for taking my question. I just wanted to key in a little bit on early adoption of Tringolza. How much of that's being driven by physicians with overlapping FCS patients that they were treating? Is that sort of the core early prescriber in this initial kind of six to nine months? And where physicians are attempting to write prescriptions, can you talk a little bit about the average processing time for them to go from an enrollment form to getting a script covered? Is that through medical exceptions, I assume? So those are my questions. Thanks.

Thanks, Jason. This is Kyle.

Happy to cover off on those. First, I'll say that the FCS launch really was important to the launch now in SHTG. Obviously, that laid the groundwork and the foundation for the readiness to bring the drug forward to a prevalent population. Many of the early prescribers are previous treaters of FCS. They have experience using the drug, and they've had really, really positive results from doing so. But we're also seeing more physicians than just the FCS prescribers starting to use Tringolza for SHTG. The other thing that I'll just mention here is the FCS growth in Q2 and the demand continue to accelerate significantly. Having more treaters and more patients on drug obviously will help us accelerate the SHTG launch as well. So the short answer to your question is yes, there are treaters of FCS that are also prescribing, but it goes well beyond that. In terms of process time, it's really too early to discuss those details. You know, we're just a couple weeks into the launch. What we've seen from payers so far is very encouraging. Not only in terms of the RX to approval time so far, but also just in terms of our conversations that we're having with the payers where they are beginning to assess SHTG and assess to put coverage criteria in place so that there's a clear pathway for approval. Here early in the launch, the majority of the coverage criteria is going to be through medical exception. That was to be anticipated. and we expect to see continued coverage, you know, improve through the back half of this year and as we start 2027 should look much better.

Thank you.

The next question comes from Ellie Merrill of Barclays. Please go ahead.

Thanks for taking the question and congrats on all the progress. Can you just elaborate a little bit more in terms of what you're seeing in terms of reimbursement? I know you mentioned that you're seeing reimbursement for Triglycerides in patients with triglycerides over 500, but are you seeing any differences in how payers are treating the coverage of patients with triglycerides over 880 versus those over 500? And then just a second question. What are your expectations for wayneua sales in polyneuropathy now after the Cardiotransform data, given much of the polyneuropathy patients are mixed phenotype? Thanks.

Yeah, thanks, Ellie. Let me start with the Tringolza question. We are seeing coverage to label. The label is very strong here, right, greater than 500. This does not limit patients over 880. It does not limit a history of acute pancreatitis. So the conversations that we've had with payers and what we've seen from the early approvals through the medical exception process has all reflected the actual indication statement in the label, which is what we expected based on our payer research going into the launch. So it will take a little bit of work for the HCPs, as expected, at launch to do these prior authorizations. to provide a letter of medical necessity potentially to justify the background therapy that the patient has been on and what their triglyceride levels are. But that's all very consistent with what we expected the policies to represent. So I think things are on track and we're very encouraged by the early interactions and discussions that we've had with payers. On the way newest side, demand continues to be strong for the hereditary polyneuropathy patient. The challenge that we are seeing on the Wainua side is with the mixed phenotype patient, where Ambutra has an indication for both polyneuropathy and cardiomyopathy. But otherwise, physicians are having very positive experience prescribing and treating these patients. and feedback has been very strong in terms of control of TTR and knockdown, control of polyneuropathy symptoms, payer access and coverage, and the ability to self-administer with an auto-injector. So we expect sales to continue in polyneuropathy and the teams continue to do a nice job.

The next question comes from Gary Nachman of Canaccord Genuity.

Please go ahead.

Hi, thanks, and good morning. So for SHTG, are you finding that most of these patients are already on some TG-lowering or lipid-lowering drugs? Are they switching to Tringolza or adding Tringolza on top of their other treatments? And are there any real true naive patients that are being put on drugs at this point? What are you hearing from physicians on Tringolza's profile as a monthly sub-Q? And has there been any real concerns with the elevated liver fat holding back prescribing at all? And how are you communicating that information?

Yeah, thanks, Gary. So the short answer to the first question is we're seeing a mix of patients. The majority of these patients obviously are high-risk SHTG patients. They're above 500. The majority of these patients have been on some sort of background therapy, which is very consistent with our Core and Core 2 trials. I mean, almost 100% of the patients were on some sort of Fibrate or Omega-3 or statin. in a clinical trial, and that's consistent with how HCPs are using standard of care today and doing everything they can to try to get triglycerides lowered below 500 and get these patients out of the risk of acute pancreatitis but have just been unable to do so. So the majority of these patients are on background standard of care therapy, and they are adding Tringulza to those patients in order to get the benefit of up to a 72% reduction in triglycerides. and up to a 91% reduction in acute pancreatitis. So they're using it very consistent with the way that the clinical trial was designed and the way that HCPs have been treating these patients up to this time. The profile is coming across very strong. First, I'll just mention the indication statement. Having AP represented there really reflects the outcome of treating high triglycerides and what that means for patients and what that means for HCPs that are trying to treat these patients. and get them out of harm's way of acute pancreatitis. The monthly auto injector is very well received. It's low dose. It's very easy to use. The patients can take it, you know, once a month. They don't have to try to figure out is it month one or month two or month three. And we're finding that, you know, consistent with the FCS launch, adherence and persistency in patients are starting and staying on and doing very well on the monthly administration with the auto injector. and for hepatic fat, I'll turn it over to Brett.

Yeah, thanks, Kyle. And Gary, thanks for the question. So, you know, we believe that the evidence that the effects on the liver fat, small increases in liver fat we see is a non-target effect is very convincing. And prior to us presenting the data at National Lipid Association earlier this year, we didn't even have pushback at that time from HCPs on concerns over the small increases in liver fat, especially because there was no association with any clinical sequelae. There were no clinical complications associated with the small increases in liver fat that we saw. That was further reinforced when we presented the NLA data, the data NLA, which we showed that with continued treatment that the increase in liver fat was returning to baseline. Again, with long-term treatment, no Association with Clinical Sequelae. So that was just reinforced there. And as we continue to evaluate patients in the long-term, even further long-term, open-label extension, again, we're not seeing any emerging adverse events in the study. So no concerns on the HCP community, and that's been further reinforced with long-term data.

Great. Thank you.

The next question comes from Moritz Reiter of Guggenheim Securities. Please go ahead.

Hi, this is Moritz Reiter for DubJet. Thanks so much for taking our question. I have two questions. The first one on Tringolza. How, if at all, has the recent Prasazoran data changed your outlook for Tringolza? And the second one on Horizon. What's your confidence in the trial, and should Horizon disappoint? How are you thinking about your path to profitability? Thank you so much.

Yeah, so, Morris, thank you for the question. We believe we have, based on everything we've seen so far, we continue to believe that we have a best-in-class medicine when you look at the totality of data for the treatment of SHTG. and when you look at the triglyceride lowering that Holly summarized in her prepared remarks and the overall reduction in acute pancreatitis along with safety and tolerability and first mover advantage also, we have no concerns about competition. We continue to reiterate our peak product sales in the U.S. have been $3 billion plus. So there was no surprises in any data that has emerged since we've launched. With respect to Horizon, our confidence remains, continues to be the same, high. We believe that LP little a is a cardiovascular risk factor, independent risk factor. The evidence is overwhelming. We have the right drug. The baseline demographics lays it all, manuscript lays it all out on the powering assumptions in that study. and the drug's been well tolerated and we're looking forward to the results later this year. And then, I'm sorry, the third part of the question was?

Should the client disappoint, what's the route to profitability?

Yeah, good morning. So I would say in the In the event that Pella-Carson Phase III were not to be positive, it would not have an impact on our 2026 financial guidance. It would put some pressure on our ability to achieve our goal of cash flow breakeven in 2028. But I want to emphasize that's a very important goal for us at IONIS, and we will work very, very hard to achieve that goal.

Thank you, Marge.

The next question comes from Mike Oles of Morgan Stanley.

Please go ahead.

Good morning. Thanks for taking the question. Maybe a few just on ION 775. Just curious if you can give us a sense of what data we might expect at the upcoming ESC meeting, maybe in terms of endpoints, you know, level of follow-up, etc. there, and then Maybe just secondly, as we think about timelines for this program, maybe you can share how you're thinking about that in terms of path to market, number of clinical studies, and is there ways to sort of shorten that, just given your experience with the core programs? Thanks.

This is Holly.

Thank you. The IN775 data that we'll be sharing at ESC, it's year-long data. It's safety as well as our efficacy and activity data and our key biomarkers. So it should be a very interesting data set for everybody to view.

In terms of where we're at, so we are in the Phase IIb study right now.

Of course, we are using all of our previous learnings to accelerate the program as much as we can. discussed timing externally, but we are absolutely using everything that we've learned from our previous programs and data sets to apply to this program.

Yeah, just to add to that, Mike, so you'll see the long-term data on triglycerides in the mildly elevated triglyceride population and the durability that 775 is offering. As Holly mentioned in her prepared remarks, this is at least twice a year or even less frequent and others. So it's a pure play on convenience. We don't believe that we can do much better than the efficacy that Tringolza is already presenting. I mean, it's a best-in-class efficacy profile. It's really allowing us to get to maybe twice a year, once a year dosing. And that's what we're going to focus on. And the data will show ApoC3 reductions that support that conclusion, triglyceride reductions that support that conclusion as well as the good tolerability. And also just to add, you know, the enrollment's going well for all those early innings for the Phase 2B study. It's going well. And our focus is to get that study done, select a dose, and move to Phase 3 as quickly as possible. But it's still too early to put timelines on when we can get that done.

Great. Thank you.

The next question comes from Yana Zhao of Wells Fargo Securities.

Please go ahead.

Great. Thanks for taking our questions. For SHTG, I was wondering, based on the first few weeks of launch, how does that early momentum track with your internal expectation, especially in relationship to The full year guidance. Apparently you made that guidance without any first-hand experience of the launch. So just curious, do you think you are ahead of that internal expectation at this point of time or in line? And for CardioTransform, I was wondering if there are regulatory paths for monotherapy and could any of the data to be presented at ESC inform how you and AstraZeneca think about any potential regulatory path. Thank you.

Thank you, Yan. And I'll take the second question first, and then I'll hand it over to Kyle to talk about how the SHCG is tracking with respect to guidance and so on. So we and AstraZeneca continue to review the data from the CardioTransforms studies, a lot of data. We're preparing to present at ESC. We're preparing to publish. We have several presentations at ESC, including the CardioTransforms study, the combination subgroup, as well as a meta-analysis study that is being conducted by an independent group of academic physicians. As far as regulatory path, AstraZeneca is weighing all their options in, and they're still going through the data. There's a lot to process there, so there's nothing new to report with that. And the data at ESC, I think, will support all the conclusions we've made already, which is very clear that in the group that was on monotherapy at baseline, so no dependence at baseline, The efficacy in the composite primary endpoint as well as the secondary endpoints are in line with the silencer class. There was no benefit in the combination group. And you'll see that data, you know, in quite detail at the ESC meeting. Kyle?

Yeah, thanks, Jan. And I'll say internally, we are absolutely meeting the expectations of the launch here, keeping in mind that we're only four or five weeks into this, so it's very early. The key priorities right out of the gate, obviously, is to get drug into channel. We did that within one week. Both the 50 and 80 milligram doses were in channel very, very quickly, allowing the prescriptions that were coming in early, if approved by the payer, to be able to go out directly to patients and get patients on drug Very quickly. So a lot of this is operational at the very beginning. And based on the launches of Tringolza and FCS and Donzera and HAE, we had a really good experience recently of launching drugs and making sure that we did this expeditiously and effectively. And it's exactly what we've done with SHTG. So I'm very pleased with the team's execution there. The other components, things around training, for example, training of the field teams, approval of materials, deployment of content, those types of things went extremely well. Our omni-channel capabilities are operating exactly as planned, so we've been able to give notice about the approval to tens of thousands of HCPs that see patients with high triglycerides, so building awareness and making sure that there's an understanding that there's a product now available to treat those patients. Payer Engagement, and Patient Services are the other two areas that I would highlight, which have both gone very well. So operationally, I'm very pleased with the team, and we're off to a very good start with the launch. In terms of full-year guidance, 100 to 110 million. We are still confident in that based on the FCS performance that we saw earlier in the year and based on the early signs and signals that we're seeing combined with the very strong label that we achieved for Tringolza and SHTG.

Great to hear.

Thanks for the cover.

The next question comes from Yarin Werver of TD Cowan. Please go ahead.

Thanks so much and congrats on the progress. Maybe, Carl, two questions for you commercially. On SHTG, one of the questions we've been getting is do you think there's going to be sort of an initial pent-up demand or bolus or some clinics already kind of triaging patients to get treated with Tringolza now that it's approved? And then secondly, for Donzera, I mean, you're seeing very nice kind of quarter-over-quarter growth. You mentioned, obviously, it's a switch market. What sort of is the main competitor at this point, and what are you seeing in terms of demand? Thank you.

Yeah, thanks for the questions. In terms of pent-up demand, we believe this is going to be a gradual build and a moderate build over time for a couple of reasons. Number one, this is a new mechanism and a new treatment, and it takes some time to educate the HCPs. Number two, we've got to get those patients into the clinic to see these HCPs. So we've got to drive that awareness and interest to the patient so that they're motivated to get into these clinics and be treated. And then the third component is the payer access piece that I discussed earlier, right? We've got medical exception process here early on as we're gaining, you know, the utilization management criteria with payers. So it'll take a little bit of time for that to build and grow. I expect that to happen through the back half of this year, and then 2027 is where we will really see the launch begin to build and pick up as HCPs gain more experience and more patients begin to come in and be treated for SHTG. On the Donzera side, I couldn't be more pleased with how the team is performing and how we are building the momentum. You know, Q2, we did $26 million in revenue, up 63% over Q1. You know, this is less than one year in the market. We've got meaningful share of a market that is a switch market. We're seeing switches. We're also seeing patients that are being treated with on-demand-only therapies be started on Donzera and also naive patients. But, you know, as you would expect, there are multiple therapies in the class, and they have different profiles. What we know from the switch data is that some patients have an efficacy challenge, some have a tolerability challenge, and some have an experience in duration of treatment issue, right, where they're having to take the drug too frequently. So it depends on which drug it is, but we're seeing switches from all of the prophylactic therapies out there, and HCPs are having very positive experiences prescribing, and they're coming back to use the drug more and more, which we're very encouraged by.

The next question comes from Agus Tewari of Jefferies.

Please go ahead.

Hey, this is Manoj for Agus. Just one from our end. Do you expect GTX102 to demonstrate a meaningful efficacy trend in the upcoming engine man-treadout? And how should we think about the potential read-through from that data to expectations for IONIS 582? Thanks.

Can you repeat the question, please?

We didn't quite get that. For the Angelman's upcoming readout for GTX102, how should we think about the rate through from that data to your program? Yeah, yeah.

Yeah, this is Holly. I'd be happy to take that. So the ultragenic stator readout, we're expecting that later this year. That will teach us a couple of things. One of the big things that we're looking for from that is to understand the placebo effect that the that patient population will have. That's not something that we know from this, so we are looking to do that. In terms of the read-through to our program for the ultragenic state itself, you have to remember that those are very different molecules. So they're dosing at a much lower dose than we're dosing, so we hope that they have positive effects that are encouraging for the community. However, if they don't, it'll likely be because they're dosing lower than we are for our study.

Yeah, and I'll just add to that. Our research organization has done a very nice job benchmarking Hobart-Anderson with ion-582 with other molecules that are out there that are in development. And we don't see any potency advantages of any other molecule compared to ion-582. So we have a highly potent molecule. and as Holly said, we've been able to dose to the maximum dose that we've set out to dose to drive efficacy as an 80 milligram quarterly dose. So looking forward to emerging data and we're looking forward to reading out our study next year.

The next question comes from Salveen Richter of Goldman Sachs.

Please go ahead. Thanks for taking our question. This is Tommy on for Salveen and just two on Trinculza. So in FCS, maybe some more color on the impact from switches from Arrowhead and on the capture of new starts, if you're seeing any. And on SHTG, maybe if you could lean more into what you're seeing from the primary care side. Thank you.

Yeah, thanks, Tommy. We've seen no meaningful impact from the competition in FCS. Q2 was by far our strongest demand quarter and the highest quarter that we've had for new patient starts. The profile of Tringolza is being very well received by HCPs. HCPs that are using Tringolza for the first time are looking to come back to it. and when they see the triglyceride lowering and the ability to self-administer with the autoinjector, the profile is stacking up very, very strong in terms of the way that they need to treat these patients and the way that the patients feel and are doing on treatment once they get initiated. On the primary care side of things, part of the audience of the 20,000 HCPs that we have targeted that are treating these SHTG patients at high risk also are from the PCP audience. So they are seeing these patients. And I think the predominant prescriptions we're going to get are going to be from cardiology, endocrinology, and lipidology. But I just think it's important to note that PCPs are seeing these patients and they're willing to prescribe and they're interested in trying to treat these patients on their own because they've been trying to do so with standard of care with fibrates, omega-3s, statins, et cetera, and just have been unsuccessful up to this point. So We will continue the very broad awareness and disease education to all specialties that are seeing these patients. And early on, we've got very positive indicators across the board.

Thanks, Tommy.

The next question comes from Luca Ise of RBC.

Please go ahead.

Oh, great. Thanks so much for taking my question. Congrats on the progress. Maybe, Kyle, one more for you on the launch of severe hyperglyceridemia. Obviously, clear enthusiasm here from the KOL community to prescribe the drug. However, we have heard from a couple of docs that one of the barriers is that there's no dedicated ICD-10 code specifically for severe hyperglyceridemia. So docs need to use codes for related conditions like hyperchilonemia syndrome or maybe hyperglyceridemia. And so that can sometimes create some barriers, some confusions to get the drug reimbursed. Is that consistent with what you've been hearing? And if so, can you talk about how you're planning to address that? And then maybe second, for TTR cardiomyopathy, Brett, if I can circle back on a prior question you mentioned at ESC, you will present this meta-analysis done by an independent group of physicians. Can you maybe just expand a little bit more on that? What's the purpose of that analysis? And how should we think about the implication of that analysis for the broader field? Thanks so much.

Yeah, thanks, Luca. On the ICD-10 code side, I'll start by saying that has been on our radar for quite some time, and it's something that we are looking for opportunities to help the community come up with an ICD-10 code that they can use to explicitly reference SHTG. So that work is ongoing with the agencies, and we'll see what we can do in order to help that happen. But in terms of reimbursement, there are other things that they can use to justify the appropriate use of the drug and get reimbursement. First is the labeled indication. Second is to support that labeled indication with the patient's medical history and reference the drugs that those patients are being treated on as well as the triglyceride levels that the patients still exhibit even though they're on those medications. So doing a prior authorization, including a letter of medical necessity, is pretty standard for a specialty product like this at launch. And we're working with the different HCPs in order to make sure they understand what's required in order to do that and also supporting them in a compliant way so that they can do that successfully.

And, Luke, I'm going to ask Holly to take the question back.

So the meta-analysis is really focused on the silencer class and understanding the totality of data within that class, including our new cardio-transform data, and comparing them both as monotherapies as well as on top of the stabilizers.

That's the main presentation. It's going to be comparing those two studies as single agents as well as combination.

Got it. Thanks so much, guys.

The next question will come from Jessica Fye of J.P. Morgan. Please go ahead.

Hey, guys. Good morning. I was curious about ion 337 for Dravet. Can you help us think about when we might see the Part 1 data from the Phase 1-2? And just given the long lead time for zurivenersin, how might 337 differentiate? Thank you.

Yeah, I'm happy to take that one. So for 337, we just started dosing. So it's too early to talk about timelines, but there's a lot of enthusiasm from the community. The KOLs know ionis and know our technology, and we're excited to get that moving quickly, as is the community. In terms of differentiation, because we're using our new NMA technology, it's more potent than the MO chemistry, our previous chemistry that we used for splice modulation. So you get increased potency, and that allows you to spread out your dosing interval and increase your efficacy.

Thank you. Thanks, Jess.

I think we have time for one more question.

Our last question comes from Eric Joseph of Citi. Please go ahead.

Hi, thanks for taking the questions. Just thinking about the upcoming core OLE data at ESC, maybe just a little bit of expectation setting there. What incremental endpoints, in addition to the NLA presentation, are of interest, or would you have us focus on there? To what extent, I guess, is an ongoing AP event rate something that you're tracking in the OLE portion? And then just perhaps a clarifying question on the strategy with 775. Is the goal here predominantly to be a convenience play over Tringolza in SHTG, or... Is there an expansion opportunity in moderate HTG that you think is worth pursuing? And if so, what would a TPP look like there? Thanks.

Yeah, thanks, Eric. I'll ask Holly to talk a little bit about what we're planning to present at ESC on the long-term data on core and core 2. I'll take 775. So the goal is primarily, we're primarily focused right now on severe hypertriglyceridemia. 775 as a follow-on molecule for this indication, and it is primarily a convenience play. I think I mentioned earlier that the efficacy and tolerability safety profile of Tringolza and SHGG is difficult to beat, so we'll strive to do that, but it's really a convenience play that we think that we can dose this drug twice a year, maybe once per year based on our Phase I data. and that phase one data will be presented at ESC and I think it'll be clear how durable 775 is. We'll always consider other indications, but primarily, and we haven't laid out, we have not established our phase three plan yet. We're still working through that. We need more phase two data before we can really make those decisions, but it's really primarily focused on SHTG. And Holly, what can we expect on the long-term data for core two at ESC?

Yep, this is looking at one year into the OLE. So, of course, we'll be looking at triglyceride levels as well as full safety data and all of the key biomarkers, looking at remnant cholesterol, ApoC3, non-HDL, all of those various markers.

Yeah, it's very exciting long-term data on the durability of efficacy as well as lack of any emerging adverse events or anything on the safety side. Thanks for the question, Eric. Thank you, everybody, for joining us today, for participating in our call. We really are looking forward to an exciting second half of the year for Ionis, and we look forward to sharing our progress along the way.

Until then, thanks, everybody, and have a great day.

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